Thursday, May 22, 2008

$12 Gas? Could be...

CNBC's report from May 20 is wending its way through the usual channels, raising a few hackles and the hair on the back of more than a few necks, as people begin to ponder how they can afford $4 a gallon to their Monster Trux and SUVs on the road. They were just getting used to paying $120 to fill up, now it's $150, and at $12 a gallon, they're looking at $450 to fill their Guzzler DeLuxe tank.

Lifestyles are changing as we watch.

Well, the price of regualr gas went to $4.17.9 a gallon at the Shell station on the corner, the highest price I've seen so far anywhere in town, and there were plenty of Guzzlers filling up when I passed by this evening. My own discount station down the street is holding the line at $3.99.9 for now, but how much longer will that last? I would bet not through next week, so I'll probably fill up the van, which I only drive once or twice a month, just in case. We have a little Pontiac Sunfire for most driving needs, and I find plenty of excuses not to drive, though I have to do some driving for my job.

Many people have taken to their bikes. So many, in fact, the surface streets are becoming clogged with bicyclists who are fairly unfamiliar with the rules of the road and for the time being are hazards to themselves and others. But I suspect they will sort themselves out quickly enough.

If gas does go to $12, fueled by the collapse of the dollar, massive speculation and bubble fever (because that's what's driving so much of inflation and economic misery right now), what could happen? The strain on the already thoroughly strained economy would potentially trigger a meltdown like we haven't seen since the Great Depression.

There might be no way to prevent that anyway, but the question is, what Americans do about it? For several years now there have been rising rates of foreclosures totalling millions annually, and yet despite some news stories about the plight of foreclosed homeowners, nearly all have simply moved on to who knows where or in what condition. They aren't living on the streets in cardboard boxes or filling the highways in their jalopies. Congress has been loathe and very slow to act. The "housing crisis" gets worse, but nothing really is being done about it (except to bail out the banks) and there is no strong sense of outrage. Not yet. But people have to have some place to live, and I suspect the only thing that's keeping the ranks of the homeless from growing exponentially so far is the overabundance of housing inventory. There's a lot of shuffling going on, but so far not so much complete destitution and dispossession.

Food prices have increased dramatically and are likely to continue to spiral into the stratosphere. People cope as best they can right now by shifting to less expensive foodstuffs, but many have already reached the lower limit, and there is nowhere left to go but to cut back on quantity. That may be a good thing for some folks, but for others it could be deadly.

Household energy prices will continue to rise, squeezing already strapped households even more severely. Something will have to give.

Employment has been flat, wages and salaries flat. In certain sectors, there has been a distinct decline in both wages and employment. This does not bode well for the future.

People on fixed incomes are once again screwed as purchasing power becomes a figment of their imaginations.

Savings -- what savings? -- are wiped out.

So far, our elites have not concerned themselves with this looming crisis because they don't have to. Nothing at all is happening to make their lives any less luxe, and increase in prices so far amounts to little more than the change fallen under the cushions for the rich. Prices rise, prices fall, it makes little difference.

And some prices have fallen so much (such as for homes) that people who have plenty of money are snapping up "bargains" such as they haven't seen in years, decades. Oh joy! Oh rapture!

And the Little People?

Not their time yet.

Not their time.

UPDATE: Whoops! Too late. Went to gas up the van at the discount station down the street this morning thinking they'd still be at $3.99.9 a gallon, regular. But no!

$4.19.9! A 20 cent increase overnight.

The Shell station on the corner is still at $4.17.9 (been there for a week), and the next station down the boulevard is $4.09.9.

UPDATE, LOS DOS: Well. That didn't last long. Regular is now $4.25.9 at the Shell station. Still $4.19.9 at the discount station down the street, and it's now $4.17.9 at the next one further on.

In addition, one 76 station about a mile away is offering diesel #2 at $5.29.9 a gallon.